Faceless Assessment

Dear Reader,

This is the world of technology and our Prime Minister is known for adopting the latest technology.

In the Union Budget 2019, the Finance Minister has proposed the introduction of a scheme of e-assessment to the limited extent.

However, on 13th August 2020, Honoring the tax payers, the Prime Minister Modi launched the program ‘Transparent Taxation – Honoring the Honest’ and launched the ‘Faceless Assessment’ scheme which has replaced the earlier e-assessment scheme.

The faceless assessment scheme aims to eliminate the human interface between the taxpayer and the Income Tax department and everything will be online i.e. notice from the department would be issued online and assesses are also required to submit response online only.

However, utmost care has to be taken while drafting the reply as it would be the only written reply based on which assessment will get finalized. So, now knowledge of the law plus drafting skills would be the key USP of the professionals.

The salient features of the faceless assessment is as under:

  1. No physical interface with the Income Tax officer and thereby no need to visit the Income Tax office.
  2. Even the selection of the taxpayer for assessment will be done by using the Data Analytics and Artificial Intelligence and there will be random allocation of cases.
  3. With respect to Income Tax office, it would be the team based assessments i.e. draft assessment order will be ready by the officers in one city, it would be reviewed by officers in another city and it would be finalized by the officers in the third city. It would literally mean that there would be abolition of the territorial jurisdiction.
  4. There would be Central Issuance of DIN i.e. Document Identification No. and it would have complete trails.
  5. Assessment orders which are not in conformity with the scheme will be treated as Non-est (i.e null and void).

However, there are certain categories of assessment for which it is not feasible nor advisable to go for faceless assessment like cases related to International Taxation, search and seizure cases etc.

Recently, even GST department has also announced to go with faceless assessment.

Thereby, we can say that in the near future, assessments of the two major taxation i.e. Income Tax and GST would be completely faceless only.